COST OF ILLEGAL IMMIGRATION MAY BE LESS THAN MEETS THE EYE

April 20, 2006

As Congress debates an overhaul of the nation's immigration laws, several economists and news media pundits have sounded the alarm, contending that illegal immigrants are causing harm to Americans in the competition for jobs, says the New York Times.

Yet a more careful examination of the economic data suggests that the argument is overstated. There is scant evidence that illegal immigrants have caused any significant damage to the wages of American workers, explains the Times:

Studies estimating that immigration has resulted in reduced wages for high school dropouts do not consider other economic forces such as the fact that certain businesses would not exist in the United States without cheap immigrant labor.

Over the last quarter-century, the number of people without any college education, including high school dropouts, has fallen sharply; this has reduced the pool of workers who are most vulnerable to competition from illegal immigrants.

In a study published last year that compared cities that have lots of less educated immigrants with cities that have very few, David Card, an economist at the University of California, Berkeley, found no wage differences that could be attributed to the presence of immigrants.

Even economists striving hardest to find evidence of immigration's effect on domestic workers are finding that, at most, the surge of illegal immigrants probably had only a small impact on wages of the least-educated Americans -- an effect that was likely swamped by all the other things that hit the economy, from the revolution in technology to the erosion of the minimum wage's buying power.

Source: Eduardo Porter, "Cost of Illegal Immigration May Be Less Than Meets the Eye," The New York Times, April 16, 2006.